IT 306 BPO 101 Unit 1 Lesson 2 PDF

UNIT 1: Introduction to Business Process Outsourcing LESSON 2: INTRODUCTION TO IT-BPM INDUSTRY OBJECTIVES: At the end of this lesson, students are expected to:  define what is outsourcing  explain what is business process o...

UNIT 1: Introduction to Business Process Outsourcing LESSON 2: INTRODUCTION TO IT-BPM INDUSTRY OBJECTIVES: At the end of this lesson, students are expected to:  define what is outsourcing  explain what is business process outsourcing Duration: 2.0 hours IT 306 BUSINESS PROCESS OUTSOURCING 101 1  UNIT 1: Introduction to Business Process Outsourcing What Is Outsourcing? Did you know that there are a lot of career opportunities in the IT-BPM industry? It is because most businesses are outsourcing some of their goods and/or services. To help us explain the concept of outsourcing, here is a short activity. Question: “When you wake up in the morning, what would you prefer to have for breakfast? A fully-loaded cheeseburger or corned beef?” Answer: Figure 1.9 A fully-loaded cheese burger or corned beef for breakfast Source: IBPAP BPO 101 Teacher’s Guide module 2013 Do you know how to prepare what you want to eat for breakfast? It does not matter, cheeseburger or corned beef, do you know how to prepare your breakfast meal? Prepare meaning, knows how to cook or to grill, to slice up ingredients. Do you have the capacity to produce everything you need – as in everything you need to enjoy either your cheeseburger or your corned beef? Try to answer the following: Do you have a cow? (Yes/No) Do you have a herd of cows? (Yes/No) Do you have a farm to grow and harvest onions, tomatoes, lettuce? (Yes/No) Do you have a dairy processing plant to make cheese? (Yes/No) Do you have the capacity to butcher a cow and process the meat? (Yes/No) Do you have a canning or packaging plant to preserve your uncooked meat? (Yes/No) IT 306 BUSINESS PROCESS OUTSOURCING 101 2  UNIT 1: Introduction to Business Process Outsourcing Figure 1.10 Ingredients are possibly outsourced by the companies Source: IBPAP BPO 101 Teacher’s Guide module 2013 The world we live in is highly interconnected and outsourced. Just imagine the number of companies involved in providing us with electricity or water. The number of players involved when we watch a movie with our friends in the theater at a nearby mall. Or, imagine the number of companies involved in sending and receiving a text message possible. Every time we buy something from somebody rather than producing it ourselves, we have essentially 'outsourced' the production of that goods or service. Outsourcing means contracting a service provider for the delivery of a process or service. Outsourcing is any task, operation, job or process that could be performed by employees within an organization, but is instead contracted to a third party for a significant period. In addition, the functions that are performed by the third party can be performed on-site or off-site. This is often referred to as Business Process Outsourcing or BPO. Figure 1.11 Business Process Outsourcing Source: https://tsdglobal.com/businessprocessoutsourcingbook IT 306 BUSINESS PROCESS OUTSOURCING 101 3  UNIT 1: Introduction to Business Process Outsourcing Business Process Outsourcing Explained Figure1.12 Subcontracting various business-related operations to third-party vendors in other countries Source: https://www.socialana.com/outsourcingtips/ Business process outsourcing (BPO) is a method of subcontracting various business-related operations to third-party vendors. Although BPO originally applied solely to manufacturing entities, such as soft drink manufacturers that outsourced large segments of their supply chains, BPO now applies to the outsourcing of services, as well. Figure 1.13 Sample back office and front office operations Source: http://supernalsolutions.com/business-process-outsourcing/ Many businesses, from small startups to large companies, opt to outsource processes, as new and innovative services are increasingly available in today's ever- changing, highly competitive business climate. Broadly speaking, companies adopt BPO practices in the two main areas of back-office and front-office operations. Back office BPO refers to a company contracting its core business operations such as accounting, payment processing, IT services, human resources, regulatory compliance, and quality assurance to outside professionals who ensure the business runs smoothly. By contrast, front office BPO tasks commonly include customer-related services such as tech support, sales, and marketing. IT 306 BUSINESS PROCESS OUTSOURCING 101 4  UNIT 1: Introduction to Business Process Outsourcing BPO is often referred to as information technology-enabled services (ITES) because it relies on technology/infrastructure that enables external companies to efficiently perform their roles. Because of the growing numbers of companies that are outsourcing their business processes, more career opportunities are being offered in the IT-BPM industry. Can you figure out now which IT-BPM sector are you going to join after graduation? What IT-BPO career would you like to pursue? Figure 1.14 Career Opportunities in the IT-BPM Industry Source: IBPAP, presented during “Career Opportunities in the IT-BPM Sector” Online IT-BPM Industry Career Roadshows- August 26, 2020 How Do BPO and BPM Differs? Many of us are asking what is the difference between the two. These two industry jargons tend to perplex especially to those who are just introduced to the IT and business industries. Luckily an online article answers this query by providing a comprehensive yet distinctive explanation of the concepts. Difference between BPO and BPM http://www.differencebetween.info/difference-between-bpo-and-bpm Key Difference: BPO, short for Business Processing Outsourcing, is the business that focuses on tasks, ranging from manufacturing products to providing customer care. On the other hand, BPM or short for Business Process Management is the process of dealing with or controlling things or people more effectively and efficiently to an over-changing environment. There is not a lot of information to differentiate between BPO and BPM, but BPO is more focused on outsourcing, whereas, BPM is more focused on management related tasks. IT 306 BUSINESS PROCESS OUTSOURCING 101 5  UNIT 1: Introduction to Business Process Outsourcing BPO, short for Business Processing Outsourcing, is the business that focuses on tasks, ranging from manufacturing products to providing customer care. It usually consists of the back office or front office operations. It is a process where number of people work for a specific business. It is originally associated with the firms of production of goods for use or sale using labor and machines, tools, chemical, and Source: http://www.mindsharptechnologies.com biological processing, or formulation such as Coca Cola that outsourced large sections of its supply chain. The trend started in the late eighties in foreign countries. It is helpful for those who are under-graduate or graduate and are not able to be employed in any company. If one has the skill, he will definitely be employed in a BPO. Nowadays, it has become a fashion or trend for youngsters to work in BPO just for time pass. Data entry and call centers are some examples of BPO operations. BPM, short for Business Process Management, is the process of dealing with or controlling things or people more effectively and efficiently to an over-changing environment. Basically, it is a subset of infrastructure management, where maintaining and optimizing an organization’s equipment are to be managed. The Source: http://www. djworx.com goal of BPM is to reduce the errors which are made by humans and focus on stakeholders. BPM has six basic strategies: 1. Simulate a change to the process 2. Process modeling and design 3. Visualize and define functions and the process improvement 4. Do up the process in an improved way for better results 5. Business rules engine 6. Workflow engine The developments of the business process are mainly focused on technology and reuse the work. It comprises of planning, organization, controlling or directing a group of people to accomplish goals. Though in all businesses, management is the act of coordinating the efforts of people to accomplish desired goals, but in BPM, they are only focused on the tasks which are related to management and, its tasks and activities. The industry is looking for a PR boost with a quick name change, so many of the BPO companies are now converted to BPM. In short, BPM refers to a management process, while BPO refers to the “state of the mind” of an organization, or more exactly of the employees. IT 306 BUSINESS PROCESS OUTSOURCING 101 6